Server Sales Show Signs of Life, IBM Remains Top Dog

Includes: DELL, HPQ, IBM, JAVA
by: Larry Dignan

Global server sales in the fourth quarter are still down from a year ago, but are showing signs of life, according to research firm IDC. IBM has the market share lead followed by HP (NYSE:HPQ) and Dell (NASDAQ:DELL).

According to IDC, the server cross currents are showing some positive indicators. To wit:

  • Worldwide factory revenue was $13 billion in the fourth quarter of 2009, down 3.9 percent from a year ago.
  • Sure, that revenue figure was the sixth straight quarter of annual declines it was the second quarter of sequential growth.
  • Shipments increased 1.9 percent to 1.9 million units from a year ago.
  • Volume systems had revenue growth of 9.9 percent in the fourth quarter from a year ago. Midrange server revenue fell 5.3 percent and the high-end market saw revenue fall 23.6 percent in the fourth quarter.

On the surface, that server revenue performance is so-so at best. However, IDC notes that the fourth quarter marked the first time in more than a year that any category of server systems showed revenue growth. IDC reckons those customers are coming off the buying sidelines for 2010.

By vendor here’s a look at the standings:

As you can see from the fourth quarter stats, Sun (JAVA) continued to take a beating. Dell, HP and Fujitsu showed revenue gains. IBM lost revenue but gained share.

By the numbers:

  • x86 server sales jumped 12.6 percent in the fourth quarter to $7.3 billion. Blade servers were 21.4 percent of all x86 server revenue.
  • Windows server demand surged 13.7 percent in the fourth quarter with revenue of $5.4 billion, the highest mark in two years. Windows server revenue surged due to accelerating x86 sales.
  • Linux server revenue was up 6.1 percent to $1.9 billion in the fourth quarter. Linux servers are 14.7 percent of the market.
  • Unix server revenue fell 18.1 percent in the fourth quarter to $3.9 billion. Unix servers were 29.9 percent of the market. IDC said customers were waiting for new systems from IBM and HP as well as clarity on the Oracle-Sun server roadmap.

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